Why Do Students Borrow So Much? Part 3

Summary

Federal student loan borrowing grew primarily because the maximum loan limits were increased and middle- and upper-income students became eligible for Stafford Unsubsidized Loans. However, despite the increases in cumulative debt that occurred, most undergraduate loan recipients appear to be able to repay their loans with little difficulty, as long as they complete their degree programs. However, repayment obligations are much more difficult for professional school students, who often leave their institutions with debt of $100,000 or more, and for undergraduate borrowers who do not complete degree programs. More research would provide greater insights into how indebtedness affects these students after they leave higher education.